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District Court 17 December 2021

McColm v Hamiltons Blasting Services Pty Ltd; McColm v Hamilton

[2021] NSWDC 688

Other
CRIMINAL LAW PROSECUTION WORK HEALTH AND SAFETY DUTY OF PERSONS UNDERTAKING BUSINESS DUTY OF WORKERS DUTY TO NOTIFY OF NOTIFIABLE INCIDENTS

Citation: McColm v Hamiltons Blasting Services Pty Ltd; McColm v Hamilton [2021] NSWDC 688
Court: District Court of New South Wales
Date: 17 December 2021
Judge: Russell SC DCJ

Background

On 10 April 2018, a blast was fired at a quarry near Albury that caused flyrock (rock fragments ejected by an explosion) to land in the vicinity of eleven workers and members of the public. Those eleven people were exposed to a risk of death or serious injury from being struck by the ejected material. No one was killed, but the incident triggered multiple prosecutions under work health and safety legislation.

The prosecution was brought against Hamiltons Blasting Services Pty Ltd ("Hamiltons"), a company providing technical surveying, drilling, and blasting services at quarries, and against its director, David Steven Hamilton. Both defendants pleaded guilty across a series of proceedings covering the conduct of the blast itself, the failure to notify the regulator of the incident, and the failure to preserve the incident site afterward.

The sentencing proceedings before Russell SC DCJ addressed the appropriate penalties for the company and the individual director across four separate sets of proceedings.

  • Whether Hamiltons' conduct in conducting the blast without an adequate exclusion zone, while permitting persons to remain in the danger area, constituted a Category 1 offence under s 31 of the Work Health and Safety Act 2011 (NSW), specifically whether the conduct was reckless as to the risk of death or serious injury.
  • The appropriate penalty for the Category 1 offence, taking into account objective seriousness, mitigating factors (including the early guilty plea), aggravating factors, general and specific deterrence, and the company's capacity to pay.
  • Whether Hamiltons breached its duty to notify the regulator of a notifiable incident and to preserve the incident site, contrary to the Work Health and Safety (Mines and Petroleum Sites) Act 2013 (NSW).
  • The appropriate penalty for the individual director, David Steven Hamilton, as a worker with duties under the WHS Act.
  • Parity between the penalties imposed on the company and on the individual, and the application of the totality principle across multiple offences.

Decision

Category 1 offence (recklessness): The court accepted that Hamiltons' conduct satisfied the requirements for a Category 1 offence under s 31 of the WHS Act. The company failed to establish an adequate exclusion zone, permitted persons to observe the blast from within that zone, and failed to delay or abort the blast until all persons were at a safe distance. Applying the test from Orbit Drilling and Orr v Cudal Lime Products, the court was satisfied that foresight of the possibility of serious injury or death, combined with indifference to whether those consequences occurred, constituted recklessness. The Category 2 offence (relating to preparatory failures, such as failure to measure drill holes, record stemming, or appoint blast sentries) was taken into account on a Form 1 in sentencing for the Category 1 offence.

Failure to notify and preserve the incident site: Hamiltons also pleaded guilty to failing to notify the regulator of the notifiable incident as required by the WHSMPS Act, and to failing to ensure the incident site was preserved until an inspector arrived. The company moved vehicles from the scene before any inspector attended, contrary to its statutory obligation. These were treated as distinct offences attracting their own penalties.

Sentencing approach: The court assessed the objective seriousness of the Category 1 offence as significant, given the number of people exposed and the nature of the risk. A 25% discount was applied to each fine to reflect the early guilty pleas, consistent with the approach under s 22 of the Crimes (Sentencing Procedure) Act 1999 (NSW). The court also ordered that 50% of each fine be paid to the prosecutor, pursuant to s 122(2) of the Fines Act 1996 (NSW).

Individual director: David Steven Hamilton was also convicted and fined in separate proceedings. His fine, before discount, was $30,000, reduced to $22,500 after the 25% early plea discount. The parity principle and the totality principle were considered in calibrating the individual's penalty against those imposed on the company.

Orders Made

Hamiltons Blasting Services Pty Ltd:

  • Proceedings 2020/254026 (Category 1, s 31 WHS Act): Convicted; fined $300,000 (reduced from $400,000 by 25% for early guilty plea); 50% of fine to be paid to the prosecutor; ordered to pay the prosecutor's costs.
  • Proceedings 2020/254003 (Category 2, s 32 WHS Act): Noted on Form 1 and taken into account in sentencing for proceedings 2020/254026.
  • Proceedings 2020/253975 (failure to preserve incident site): Convicted; fined $12,000 (reduced from $16,000); 50% of fine to be paid to the prosecutor; ordered to pay the prosecutor's costs.
  • Proceedings 2020/253944 (failure to notify): Convicted; fined $12,000 (reduced from $16,000); 50% of fine to be paid to the prosecutor; ordered to pay the prosecutor's costs.

David Steven Hamilton:

  • Proceedings 2020/254184: Convicted; fined $22,500 (reduced from $30,000); 50% of fine to be paid to the prosecutor; ordered to pay the prosecutor's costs.

Key Takeaways

  • A Category 1 offence under s 31 of the WHS Act requires proof that the defendant foresaw the possibility of death or serious injury and was indifferent as to whether those consequences occurred. The District Court confirmed that this standard of recklessness was satisfied where a blasting company fired a blast without ensuring all persons were outside an adequate exclusion zone.
  • Under s 122(2) of the Fines Act 1996 (NSW), the court has the power to direct that 50% of any fine imposed in a WHS prosecution be paid to the prosecutor. The court exercised that power across all four sets of proceedings.
  • A 25% discount on the base fine was applied to reflect the early guilty pleas entered by both the corporate defendant and the individual director, consistent with established sentencing principles under s 22 of the Crimes (Sentencing Procedure) Act 1999 (NSW).
  • Separate and distinct obligations to notify the regulator of a notifiable incident and to preserve the incident site exist under the Work Health and Safety (Mines and Petroleum Sites) Act 2013 (NSW). Breach of each obligation attracts its own penalty, and both were prosecuted here alongside the primary blasting offences.
  • Individual officers or workers can face personal liability for WHS breaches arising from the same incident as their corporate employer. Here, the director received a separately assessed fine, with parity between his penalty and the company's fines considered as part of the sentencing exercise.

Legislation and Cases Referenced

Legislation:
- Work Health and Safety Act 2011 (NSW), ss 3, 19, 28, 31, 32, 33, 34, 35
- Work Health and Safety (Mines and Petroleum Sites) Act 2013 (NSW), ss 14, 15, 17
- Work Health and Safety (Mines and Petroleum Sites) Regulation 2014 (NSW)
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 22, 32, 33
- Fines Act 1996 (NSW), ss 6, 122
- Explosives Act 2003 (NSW)

Cases:
- Orbit Drilling Pty Limited v The Queen (2012) 35 VR 399
- Orr v Cudal Lime Products Pty Ltd; Orr v Shannon [2018] NSWDC 27
- Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96
- Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338
- Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610
- *Markarian v The Queen